What is a Blockchain?

Blockchain, it was a shared database or a some kind of ledger, which all the nodes in a computer network share. Most people know about its use in cryptocurrency, where it keeps a secure and decentralized ledger of transactions. Data is saved in blocks that are associated using cryptography, where one of the main applications remains being a public transaction ledger. Decentralized blockchains, such as that of Bitcoin do not have anyone in charge, thus the transactional information entered into them cannot be changed or reversed.

Actual process of how a Blockchain works:

1. Facilitating a Transaction: When a new transaction enters a blockchain network, it gets double encrypted with public & private keys.
2. Verification of Transaction: This transaction goes through a distributed network of peer-to-peer computers that are spread across the world. The nodes on the network validate the transaction like ensuring that there are sufficient funds.
3. Formation of a New Block: When the transactions verify successfully, they are added into a mempool that connects with some other mempools that finally form a single block.
4. Consensus Algorithm: To avoid attaching an invalid block, nodes in a block utilize a consensus mechanism.
5. Addition of the New Block to the Blockchain: An authenticated new block containing the required hash information is then attached to the blockchain. The blocks are chained by means of cryptology.
6. Transaction Complete: Thereafter, the transaction is entered into Blockchain, which is never deleted, and everyone is able to verify it at any time.

What do you know about Centralized Blockchains?

According to me, Centralized blockchains combine a centralized management system with a decentralized network. A centralized authority controls information that gets released in a decentralized network of peers. Such types include Ripple, Hyperledger, Coinbase, Kraken, Binance, and Gemini. It is possible for users to access efficient centralized blocks with faster processing times and larger throughputs. However, they are not transparent and trustworthy, thus they can be manipulated by the controlling authority or hacked.

Share your thoughts about the Decentralized Blockchains.

Unlike centralised block chains, e.g., Bitcoin ensures no one is in charge. Nodes are the network of different participants whose transaction are authenticated. They are decentralized but have better integrity, improved security and reliability. Consensus building via either Proof of Work or Proof of Stake is aimed at achieving consensus about transaction authentification. Scalability issues and energy wastage pose some challenges for decentralized blockchains.

In my view, each blockchain may be chosen depending on a particular purpose under consideration. Decentralized blockchains allow clarity among entities, and that require trust, security, and safety in their transactions. While centralized allow optimal proficiency and effectiveness for fast application-based solutions among entities that require speed and performance. With time, blockchain technologies will be improving and we should observe progress not only in centralized but also in decentralized kind of blockchains. Applying the power of this revolutionary technology will link on striking the optimal stability between efficiency and trust.